Asked by Emanuel Holesome on Apr 30, 2024
Verified
(Figure: The Demand and Supply of Wheat) Use Figure: The Demand and Supply of Wheat.If there is an increase in demand of 2,000 bushels per period at each price,the equilibrium price and quantity will be _____ and _____ bushels per period,respectively.
A) $5;5,000
B) $6;7,000
C) $7;7,000
D) $8;8,000
Equilibrium Price
The cost at which the volume of goods available equals the volume desired by buyers in the market.
Equilibrium Quantity
The quantity of a good or service demanded and supplied at the equilibrium price, where market supply and demand balance each other.
Bushels
A unit of volume used primarily in agriculture to measure quantities of grain, fruit, or other produce.
- Gain insight into the implications of supply and demand fluctuations on the equilibrium of price and quantity.
Verified Answer
LP
Luann PetersonMay 03, 2024
Final Answer :
C
Explanation :
An increase in demand of 2,000 bushels per period at each price will cause the demand curve to shift to the right. This would result in a new equilibrium price of $7 per bushel and a new equilibrium quantity of 7,000 bushels per period, as shown by the intersection of the new demand and supply curves. Therefore, choice C is the best answer.
Learning Objectives
- Gain insight into the implications of supply and demand fluctuations on the equilibrium of price and quantity.